American Airlines, pilots reach preliminary labor deal

An American Airlines plane prepares to land at the Miami International Airport on May 02, 2023 in Miami, Florida. 

Joe Raedle | Getty Images

American Airlines and its pilots have reached a preliminary agreement for a new four-year labor contract after months of tense negotiations, a milestone for the country’s biggest carrier.

The terms of the deal weren’t disclosed but are likely to include big raises as the industry faces a pilot shortage and aviators seek better pay after the Covid-19 pandemic paused new contracts for years. Pilots have also pushed for quality-of-life improvements like better scheduling.

The airline was prepared to offer 40% cumulative raises in a four-year deal, American Airlines CEO Robert Isom said in March. The airline had said that including 401(k) contributions, a senior narrow-body captain would be making $475,000 a year at the top of the scale.

The new agreement will likely take several weeks to finalize. The union said it has to approve contract language before sending it to American’s roughly 15,000 pilots for a ratification vote.

“We’re pleased to have reached an agreement in principle on a new four-year contract with the Allied Pilots Association (APA) that provides our pilots with pay and profit sharing that match the top of the industry with improved quality-of-life provisions unique to American’s pilots,” an American spokeswoman said in a statement.

Negotiations across the industry have been tense. American’s pilots recently authorized the union to call a strike if an agreement couldn’t be reached.

Pilots at United Airlines, Southwest Airlines and FedEx are still in negotiations. Aviators throughout the industry have picketed at airports around the country over the past few years. They have demanded pay hikes and better schedules, among other improvements, as they faced what they described as grueling schedules during the rocky travel rebound and higher costs of living without raises in years.

Delta Air Lines‘ pilots in March approved a new labor agreement with 34% raises over four years. Delta was the first of the large U.S. carriers to reach a deal.

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Article Courtesy of CNBC

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